Premier League clubs poised for cash bonanza as Facebook and Amazon prepare to enter streaming rights bidding war

Premier League clubs are braced for digital giants such as Amazon and Facebook to gate-crash the bidding for streaming rights when the next TV deal is negotiated in the coming months, according to Ed Woodward, the executive vice-chairman of Manchester United.

The news could result in another huge rise in the broadcast income for clubs, which would risk driving transfer fees and player wages even higher, and pose a significant threat to the stranglehold Sky and BT Sport have over domestic TV rights given the colossal financial might of the new media providers.

Facebook underlined its determination to enter the sports market with a failed £444 million bid for digital rights to cricket’s Indian Premier League earlier this month while Amazon has paid £37 million to live stream the 10 Thursday night NFL American football games this season. Google and Netflix have also been touted as potential bidders for Premier League rights.

The existing three-year deal, which runs until the end of next season, is worth £8.6 billion, about £3.5 billion of which is accounted for by overseas rights, with the auction for the 2019-2022 due to start later this year and completed around February.

The prospect of a heated auction involving some of the world’s biggest tech firms has already led analysts to estimate that Sky may have to pay a premium of up to 45 per cent on the £4.2 billion it paid last time around – the equivalent of another £1.8 billion – in order to fend off the threat.

Looking at the interest they had in the Indian Premier League, it sounded like big numbers

Speaking on a conference call to investors, Woodward confirmed Facebook and Amazon were expected to enter the bidding for Premier League rights and possibly Champions League rights. “Absolutely I think they’ll enter the mix,” Woodward said. “Anecdotally there was strong interest in the last cycle, and we’re hearing that around the Premier League table, but we’re also hearing that from a European perspective as well in terms of interest in the Champions League and Europa League rights.

“In the wider picture you have to look at what’s happening elsewhere at the moment. There isn’t any clear European sale to these kind of partners at the moment. But looking at the interest Facebook and Amazon had in the Indian Premier League rights, anecdotally it sounded like very big numbers.”

Ed Woodward (right) told investors that a number of new players are ready to enter the bidding for Premier League rights and possibly Champions League rightsCredit:
Getty Images

He added: “So I do think we are going to see an increase in engagement from these and we would welcome the interest. I think it’s going to be increasingly important to digitally engage with fans, and we think we can be complementary to partners like this coming in.”

Woodward’s remarks follow comments from Premier League executive chairman Richard Scudamore last month when he effectively opened the door for new media platforms to bid. “We envisage anybody, really, being able to come along and bid for those rights,” Scudamore said.

There have already been signs of change in other sports. The tennis ATP World Tour recently sold its rights to Amazon over Sky. Similarly, in golf, the PGA of America explained that it did not show this year’s USPGA on Sky as it instead sought “broad, multi-platform distribution”.

Ever increasing TV revenues could lead to greater escalation in transfer fees but Woodward said there was a willingness among the clubs, as well as the authorities, such as Uefa, to enforce Financial Fair Play and ensure rules were followed. This summer saw Paris St-Germain smash the world transfer record to sign Neymar from Barcelona for £199 million and commit £166 million to sign Kylian Mbappe permanently from Monaco next year.

“The rhetoric isn’t just coming from clubs, it’s coming from Uefa and the European Club Association,” he said. “I think the willingness is there to look at it closely to make sure the rules are being abided by and penalties are looked at. There’s nothing concrete going on at the moment but I do think there is a noise level that has increased since August.

“Structural reform? No, not really. It broadly works within the structure of what we have around us in an EU perspective, as an industry and a market we don’t think it has major issues.”

United said they expected to earn about £30-40 million from the Champions League this season, about £10 million less than they would ordinarily do because they miss out on the market pool as a consequence of only qualifying for the competition via winning the Europa League as opposed to the Premier League.